Correlation Between Touchstone Ultra and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Touchstone Ultra and Baillie Gifford at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Touchstone Ultra and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Ultra Short and Baillie Gifford Global, you can compare the effects of market volatilities on Touchstone Ultra and Baillie Gifford and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Touchstone Ultra with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Ultra and Baillie Gifford.
Diversification Opportunities for Touchstone Ultra and Baillie Gifford
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Touchstone and Baillie is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Ultra Short and Baillie Gifford Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Global and Touchstone Ultra is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Touchstone Ultra Short are associated (or correlated) with Baillie Gifford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baillie Gifford Global has no effect on the direction of Touchstone Ultra i.e., Touchstone Ultra and Baillie Gifford go up and down completely randomly.
Pair Corralation between Touchstone Ultra and Baillie Gifford
Assuming the 90 days horizon Touchstone Ultra Short is expected to generate 0.09 times more return on investment than Baillie Gifford. However, Touchstone Ultra Short is 11.32 times less risky than Baillie Gifford. It trades about 0.2 of its potential returns per unit of risk. Baillie Gifford Global is currently generating about -0.05 per unit of risk. If you would invest 912.00 in Touchstone Ultra Short on December 30, 2024 and sell it today you would earn a total of 12.00 from holding Touchstone Ultra Short or generate 1.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Touchstone Ultra Short vs. Baillie Gifford Global
Performance |
Timeline |
Touchstone Ultra Short |
Baillie Gifford Global |
Touchstone Ultra and Baillie Gifford Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Touchstone Ultra and Baillie Gifford
The main advantage of trading using opposite Touchstone Ultra and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Ultra position performs unexpectedly, Baillie Gifford can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Baillie Gifford will offset losses from the drop in Baillie Gifford's long position.Touchstone Ultra vs. Franklin Government Money | Touchstone Ultra vs. Vanguard Money Market | Touchstone Ultra vs. Davis Financial Fund | Touchstone Ultra vs. Cref Money Market |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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